The Economic Empowerment Action Group (EEAG) has described as segregation, government’s focus on Indian companies to bid for construction projects funded by a loan from an Indian bank.
EEAG’s concern comes in the wake of government’s focus on Indian companies to bid for the projects that will be implemented with a $76.5 million (K26 billion) loan from the Import and Export (Exim) Bank of India.
But Ministry of Finance spokesperson, Nations Msowoya, argued that the restriction is one of the conditions attached to the loan government is getting from Exim Bank of India.
Ministry of Finance last month called for bids from Indian companies to design, supply and install fuel storage facilities in Lilongwe, Mzuzu and Blantyre; irrigation networks in Karonga, Salima and Mangochi and a sugar processing plant in Salima.
EEAG president Louis Chiwalo stated that this is against international fair trading practices arguing that as much as the loan is from an Indian bank, it is Malawian taxpayers who will repay the loan and; hence, they have to benefit from the opportunities.
“This is absolutely unacceptable. We would understand if it were a grant and not a loan as is the case. Economic opportunities have to be shared. Malawian contractors too have capacity to do this job well,” he said.
Chiwalo said although Malawians will have the facilities, they will not benefit from the economic opportunities arising from the projects; hence, all the money will return to India.
He added that this practice does not auger well with fair trading practices as it is restrictive to other companies.
On his part, Msowoya argued that the restriction is as a result of the condition of the loan that government is getting from Exim Bank of India.
“The mandate of Exim Bank of India is to promote exports from India and this why eligible bidders have to be of Indian origin or Indian companies only with the aim of promoting Indian firms,” he said.
Msowoya said they advertised in Malawi to give Indian firms resident in the country to take advantage of the opportunity.